The Washington Free Beacon happened to stumble upon an interesting factoid, and they published it. One day, the Obama administration spent $94,360 hiring a Democrat-connected event-management firm to build a stage for an 18-minute speech. The shock is not that it happened; it happens every day. The shock, to any who are paying attention, is how differently the political factions viewed the news.

Conservatives were horrified, and liberals were offended that anyone would even care. A hundred thousand dollars in a country of our size? A hundred thousand dollars in a nation of fifty states, of 300 million people? A pittance, they say. Its a drop in the bucket.

But theres a lot to think about, when talking about any sum of money spent by our government. The government made a conscious choice to spend this money, a hundred thousand dollars, on one event lasting less than an hour. Contemplating how they spent it, and why, might well be revealing to learn, not just about the event itself, but also about the different economic views of the two political parties, and of the two economic theories, that are currently contesting for the reins of the United States of America.

The Event

The president wanted to give a speech at MacDill Air Force base, so the administrations Tampa connections hired Elite Productions to set up the stage, draperies, and audio-visual equipment for a speech. This September 17 speech lasted 18 minutes.

Such no-bid contracts happen all the time in an administration with no brakes on spending, an administration that respects no code of purchasing ethics, no internal audit function. They want a shiny stage with backdrops to hide the unappealing visuals of an airplane hangar; they hire whoever the local Dems use for such things.

Past presidents have always maintained a dividing line between partisan politics and the administration role. Not to say that theyve all been perfect and tying political events in with official trips is certainly commonplace but there has always been a line. The government may manage the time from 8:00am to 5:00pm, for example, but then the evening would be free for political events. This blending of the two, with no lines of demarcation whatsoever, is strictly an Obama administration phenomenon.

The Money

$94,360 IS a lot of money. No, its not a trillion dollar boondoggle like the so-called Stimulus passed in 2009, or the obamacare disaster passed in 2010 but yes, its a lot of money. Lets add in the cost of the government employees who had to work with Elite Productions, in ordering the supplies and supporting their setup, and were at a nice round number of $100,000.

While thats a small figure in the context of the US Government, its huge for all but a miniscule subset of Americans. Its over double what most workers earn in an entire year. Its enough for a four-year degree at most colleges. Its enough to buy five normal automobiles that will last six or seven years.

And this administration blew it on an 18-minute speech.

Surely its not an exaggeration to say that theres something wrong with that.

The Spending

There is a bit of envy at the core of many common complaints about spending. We may see a friend buy a flashy new car when his old one was still new, or remodel a kitchen or deck when their old one still looked great and worked fine. We may say Think of what else that money could have been spent on! You could have fed a poor family for a year for that!

But there are key differences here. That homeowner is employing auto workers and the car salesman and the banks loan officer. Or hes employing carpenters and painters, the craftsmen and construction workers who build that deck or that kitchen. So they ARE helping people by these expenditures, helping people stay out of poverty, perhaps even helping them prosper. Such homeowners help small businesses thrive by employing the contractors and installers, and help big businesses thrive by purchasing the appliances. Their consumerism, so often derided by the smarmy, actually helps their fellow man in every way.

This argument, however, is predicated on it being his own money. The homeowner has already earned it, and now has the right to spend it as he chooses. Whether he spends it at the local restaurant, at the local mall, or on all these wonderful contractors, he is doing a great deal for his community by spending his money locally.

No such argument can be made in favor of ANY government spending, because the government isnt spending its own money. The government does not have, and CAN not have, its own money, by definition. Government only has two ways of acquiring money  by confiscating it through taxation and by borrowing it through bonds. The former denies the public the ability to spend it their way today, and the latter denies the public the ability to spend it their way tomorrow.

So when we consider government spending, we mustnt just ask whether the contract was properly bid out, and whether the contractor was really the best and most cost-efficient of the choices presented. We must first ask whether the expenditure under discussion is necessary at all.

This is what we should be asking about EVERY government expenditure, big and small, forever. This is what our Founding Fathers asked, back when the government was appropriately small, and when every penny in the public coffer had to be carefully managed.

We must first ask Is this government activity worth the result of denying the public the ability to spend their money their way? Is todays stage rental for the presidents 18-minute speech worth the result of denying that money to the local restaurants, theaters, stores, and other small businesses who would get it if the government didnt take it from them first?

The Parable of the Paint

One of my favorite Newt Gingrich stories is this one: Three people walk into a room  a liberal, a moderate, and a conservative. The liberal says Oooh, lets paint it bright green! The moderate shudders and says Oh, thats a bit much, lets go with a quiet, muted sage. The conservative shakes his head and says For goodness sakes, we dont need to paint it at all; its fine! It was just painted last year!

This is the key point for so much of what our government does today. The issue of who we hire for a project IS an important political issue. We DO have a right to demand that politically-connected firms arent given special priority on any government projects.

But even more so, we have a right to demand that projects dont go forward that arent needed at all.

Yes, this $100,000 in government spending helps a Democrat-connected company, and may help them do things for their Democrat clients at a reduced rate. Thats wrong. Its unethical; its irresponsible and immoral.

But what if its also a completely unnecessary expense? We shouldnt just be yelling at who the $100,000 goes to, we should be furious at the fact that there was no need for this expenditure at all!

This Air Force base has meetings all the time. They have meeting rooms, if you need a room. They have chairs, if you need seating. When the press attends an event, they bring their own microphones, their own cameras, even their own lighting if they need to.

Thats how other presidents, of both parties, have handled such things. They hold events on a dock, on a lawn, in front of a building, inside an airport hangar. No extras are needed; theres a theatrical benefit to the realism of an actual location, unadorned and unmanaged.

But this administration wants to manage even an 18-minute visit to a base, as if it were a campaign event perhaps because, as Rush Limbaugh describes it, this administration lives in a permanent campaign. If they can just look like theyre always campaigning, never governing, then they can complain about everything without taking any of the blame for the governing that theyve actually done.

$100,000 to build a stage, without reason or need. $100,000 for 18 minutes. And they do things like this every day, by the hundreds of thousands, by the millions, even by the billions of dollars, passing programs that are unnecessary or even counterproductive, wasting time and money, so they can boast to their voters that theyve voted for, and passed, some great-sounding bill, like an Affordable Care Act thats anything but affordable, or a Jobs Bill that destroys jobs rather than creates or prepares for them.

And so the nation suffers, in a six-year non-recovery recovery, where everything from the administration is temporary stages and shiny draperies, the modern version of the smoke and mirrors that an Emperor with No Clothes has used to bamboozle his audiences since time immemorial.

Copyright 2014 John F. Di Leo

John F. Di Leo is a Chicago-based Customs broker and international trade compliance trainer. A former county chairman of the Milwaukee County Republican Party, he is also a community theatre actor, and could tell the government a few things about producing a show on a budget of well under a hundred grand.

Permission is hereby granted to forward freely, provided it is uncut and the IR URL and byline are included. Follow John F. Di Leo on Facebook or LinkedIn, or on Twitter at @johnfdileo.

One day, the Obama administration spent $94,360 hiring a Democrat-connected event-management firm to build a stage for an 18-minute speech. The shock is not that it happened; it happens every day. The shock, to any who are paying attention, is how differently the political factions viewed the news. Conservatives were horrified, and liberals were offended that anyone would even care. A hundred thousand dollars in a country of our size? A hundred thousand dollars in a nation of fifty states, of 300 million people? A pittance, they say. Its a drop in the bucket.

"There's a hole in the bucket, dear Liza, dear Liza, There's a hole in the bucket, dear Liza, a hole."

Has any previous administration had the-sky’s-the-limit attitude about First Family vacation expenses? They think nothing of spending millions for Michelle to vacation in Spain or spend extra days in Hawaii after Barack returns to Washington. Maybe the Clintons came close but I suspect the Obamas have far surpassed even the Arkansas Grifters.

I could certainly think of wiser use of funds, but the fundamental result is that dollars circulate one way or another, often times - if not predominantly - in directions taxpayers would eschew. Money paid to cronies does not vanish. They eventually spend it some something, or it goes to someone else when they die - mostly to Uncle Sam to spend like a drunken fool. But the bartender says, “thank you!”

12
posted on 10/01/2014 8:06:49 PM PDT
by Fester Chugabrew
(Even the compassion of the wicked is cruel.)

Elite Productions receives $100,000.00 of taxpayer dollars. Does this money then just vanish?

No, of course not. The people at Elite Productions spend it on whatever they want to.

But wasting $100,000 which was earned by the hard work of taxpayers is very damaging to our economy and society as a whole. The only way to make progress in society is for money to be invested in worthwhile activities, and this clearly isn't in that category.

I suspect you are alluding to Keynesian economics where supposedly spending money in any way helps the economy. Unfortunately that theory fails in practice. Spending and investing wisely helps society, wasting money doesn't.

I’m greener than a 3-dollar bill when it comes to economics. My outlook and inquiries tend to be overly simple. For example, I ask myself, when someone has intellectual property - no tangibles other than sounds, words, etc. - and a population takes enough interest to spend money on it, where does the money come from, and where does it go? The zero-sum outlook would keep the number of dollars static. But we print more dollars. Does not a growing economy require more dollars? How arbitrary is the assignment of value between a dollar and its object?

It is all somewhat complicated to me on the one hand, and yet my questions are merely those of a layman who lives hand to mouth, one day to the next, sometimes wasting money with regrets, sometimes not. I’ve been a solid contributor to the brewers of Hamm’s for a number of years now.

15
posted on 10/01/2014 8:40:28 PM PDT
by Fester Chugabrew
(Even the compassion of the wicked is cruel.)

I’d like to respond in particular to these last couple of points, because I think in retrospect that I didn’t hammer one point as hard in my column as I’d intended (that’s the problem with doing my writing at 2am I guess!)

In addition to the damage done by overspending and borrowing for needless spending (this $100,000 is really going to cost a few hundred thousand, because it’s borrowed), part of the damage that it does is that it’s essentially campaign fraud.

By giving government money to a vendor normally used by Dem candidates, this vendor can now charge those candidates less than he normally would. That means that government money has essentially been used to support a campaign, a total violation of all Federal Election Campaign acts.

Not that the GOP will ever be courageous enough to bring up the point in a campaign. The first we’ll hear of most Republican party officials about Dem vote fraud, Dem fundraising improprieties, and other Dem violations will be AFTER the election is over.

Fester Chugabrew, you’ve reminded me of a theme I used to write about, but haven’t lately. I should revisit the issue.

The subject you bring up is absolutely right - government can’t print the number of dollars to cover last year’s economy, it has to print the number of dollars to cover today’s economy, as value is constantly invented.

I like to use examples like the painter or the carpenter in my illustrations... Here’s an example, if you’re interested...

Taking the examples of a carefully-crafted wedding ring that is melted back into raw materials, or a once-valuable house that is demolished on account of political contrivances, while these may indeed represent a loss of value, the process of new value created is ongoing.

What baffles me is how we assign value to something. We convince ourselves that by shaping materials we’ve added value - the amount to be determined how and by whom? - but by allowing materials to revert to raw form, the value goes away. The purported image of the Virgin Mary on a piece of toast sold for how much?!!! The determining factors must include uniqueness, scarcity, and objective benefit to the purchaser(s).

How does one make a living from words? The words must bestow some benefit to the hearers, so much so that they will part with their substance to receive them, both retroactively and in advance. Fascinating.

A lot of this to me is like smoke and mirrors. I am a true simpleton insofar as I readily accept what the Psalmist writes: “The earth is the LORDS, and all it contains, the world, and those who dwell in it.” So “ownership” and “value” and “waste” are things I view with curiosity and experience concretely at the same time. Thanks for pointing me to that article. I’ve read a few others of yours and have been much edified.

18
posted on 10/01/2014 9:26:28 PM PDT
by Fester Chugabrew
(Even the compassion of the wicked is cruel.)

I think the answer to the question you pose is that it’s in the hands of the free market. The invisible hand, so to speak.

It doesn’t matter whether you or I think this car is worth $25K or $35K or $95K, the question is whether someone will spend his own money on it. And if he will, then his purchase is what defines how much value the carmaker has added to the raw materials he purchased to manufacture it.

And that’s one of the reasons why the same number of companies are more financially productive in a boom year than in a lean year; it’s not enough to make a product, someone has to choose to buy it. And what they choose to spend is what defines how much money you’ve made; how much value you’ve created.

This is the key reason why the traditional Keynesian economic model is so wacky; it pretends that economic activity is predictable by formulas. In fact, it’s the Misesian or “Austrian School” that really makes sense, because this is the economic theory that acknowledges the fact that economics is a social science, not a hard science. All economic activity is based on human choices. (and libertarian economic theory is to empower those humans, both as producers and consumers, to have as free a range of choices as possible!)

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